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tv   Markets Now  FOX Business  August 15, 2013 11:00am-1:01pm EDT

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look at those but his sympathies are with the muslim brotherhood. charles: i will put it in your hands now. dagen: good to see you. the decile in egypt climbs to more than 500 in one of the deadliest days that country has seen in years. president obama calling for calm. trending downward, not just the market, but the president's approval rating on the economy flipping to 35% last month. seven percentage points lower than june. detroit emergency manager apologizing after calling some of the city residents those names. and the nfl hit with another concussion lawsuit. 83 former players led by pro-bowlers. they say they are suffering long-term effects from brain injuries sustained during their playing days.
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and we're watching the market this hour of "markets now." ♪ connell: those headlines show you there is a lot going on-9 today. we will get to the mess in egypt in just a moment, but first, our market today with the selloff, seeing the biggest decline in a couple of months. nicole petallides starts us off on the floor of the new york stock exchange. nicole: you are absolutely right. the lowest point, the biggest move to the downside since june 20. down about 1.5% right now. back on june 20 the dow dropped over 2%, this is the biggest moving percentage terms since that time. you have a couple of names that
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are weighing on the do dow jones industrial, better-than-expected economic news. walmart and kohls are two names we are following closely. as well as cisco systems. walmart higher payroll taxes are hitting the customers and not much customer traffic in walmart. a little less than expected, up 5.5%. really bucking the trend today, back to you. president obama: united states strongly condemns the steps taken by egypt's interim government and security forces. we deplore violence against civilians. we support universal rights essential to human dignity.
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including the right to peaceful protest. we oppose the pursuit of martial law, which denies those rights to citizens under the principle that security trumps individual freedom. connell: president obama delivering those remarks a few moments ago on the violence in egypt with yesterday marked the deadliest day against mubarak. senior fellow for national security and heritage, the only real headlines the president may or calling off the exercises with the egyptians. anything else the u.s. should be doing that they are not? >> the lack of interest we have in egypt going back to the arab spring and the beginning of it when the president allowed mubarak to be replaced. that is more than two years ago now. it really shows a lack of influence we have here, most of those comments were just platitude.
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everybody wants the violence to stop. both sides have been throwing punches here. he overlooked the opportunity to influence the military by not calling it a coup. said we will not address it, and they decided they would not call it a coup. they may have cut off military aid and held their feet the fire about moving forward, but it is a mess, bad for the middle east stability, and i don't think the administration has a plan, unfortunately. connell: lets take up those issues in order. the effect on the rest of the region in a moment, but you mentioned aid from the united states egypt even though the exercises have been called off, what about that going forward. should we be giving the egyptians money? >> they have decided to transfer the f-16 but congress will step in, they are in recess, but they
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will be back shortly, something has to be done. not just the egyptian military, there are problems on the other side with the egyptian brotherhood, but we don't have any influence. we do have some levers, one of them is aid that we pass on to egypt. connell: even though there are other countries in which the united states is more fully invested in terms of dollars, raw dollars as you see there. in afghanistan we have been involved for so long. even with that said, it will be interesting if congress pulls the string on that, what about the influence of what is happening in egypt on the rest of the region we have shown. this is still the center of it all in a lot of people's minds.
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>> as hamas and al qaeda on the rise, look at what is going on in iraq, if we have a comprehensive policy does not effective at a minimum. egypt is a very important country in that part of the world. a leader of that country, supportive of american interest. camp david, the suez canal which is a strategic waterway. there's a lot at stake and the administration is really going to have to step up their game here. what the president said will just be falling on deaf ears. connell: with more than 500 dead as far as we know, things are at a critical point. the president's approval meeting ratings continue to drop.
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it is down 7% since june. dagen: deputy editor of the wall street page. 200 plus loss on the dow, two pieces of news today in particular cisco will lay off 4000 more people, 5% of the workforce. you look at the numbers from walmart, you can see what people don't feel so great about the economy. >> that is right. you cited the president's approval handling of the economy dropped from 44 to 35%. a 35-point drop, pretty dramatic falloff. this was happening while the stock market was rising, so in a way the stock market which is usually the leading indicator, it is beginning to look more and more like a lagging indicator. catching up with the sentiment people feel in the real economy. that is where they get a raise
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or don't get a raise. that is what walmart report speaks to. there was one bad report in the last week, that was macy's. mom and pop are not doing much of that. this is something we have talked about often on this program. this is what happens we have economic growth rate of 2%. the american people are sending out there feeling, there's no excitement, no lift, no growth. they are starting to blame president obama for that. dagen: you had jobless claims at almost a six year low. we talk about the most important thing this economy is jobs and jobs. it slides in the face to what we've heard from cisco today but that should be showing up in people's sentiment, should it not?
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>> it is hard to know what to make of that. there is more of that to come. we have had the federal reserve with this 0% interest rate policy now going on nearly four years. they have done what they are hoping to do. the burden seems to shift to president obama. what can he do policy was to create incentives in the economy? one of the things we talked about his tax reform. yet harry reid said about a month ago tax reform is dead, they will not be able to do it. no leadership on this issue. connell: will rising interest rates be the big story? >> the market suggests is having a pressing move on the stock market which means the wealth falls further depressing people
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about the idea they would go out and purchase anything so we have a vicious circle underway now that simply represses the economy. dagen: essentially promoting the recovery in the housing market. he was in phoenix, and much of the recovery is owed to the federal reserve and the interest rate policies and what they have done. if he will try to take some of the credit, he has to take some of the blame. >> yes, what he is proposing is what he proposed in the first week of his presidency. more federal spending on infrastructure, more on education. that is not what the economy needs to lift itself right now. more animal spirits.
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connell: as always, thank you very much. dagen: apple set to unveil the new iphone next month, but are you going to get anything from apple that will excite you? connell: the financially strapped new jersey devils have a buyer. and it is not his only professional sports team. somebody is already an owner. dagen: some in detroit dumb, lazy, rich. he apologizes. that is coming up. oil prices, what is going on in egypt. you have a market severely lower, but oil is 107.52 today. right now, 7 years of music is being streamed.
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dagen: fingerprint scanner, a gold case, a missile defense system. don't expect any of these when it comes to the new iphone. anwe believe it will simply be n incremental release with normal
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upgrades, slightly better camera, better processor. apple is expected to unveil the iphone september 10 or even a cheaper iphone. shares of apple today, you can take a look at it down slightly. connell: the incremental updat updates. connell: when they did the demonstration of that, that is good. very good point. sports business for you, the owner of the philadelphia 76ers reaching an agreement to buy the new jersey devils. he would buy the devils and assume the lease. board of governors said to have
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approved the deal yesterday announced sometime today. the deal is worth over $320 million along with the devils he will have to assume 370 million in debt and repay a lawyer. it is tough with the rangers and all the other teams and other sports. dagen: let's support our new jersey devils. connell: voted the most unfriendly city in the world. islamabad was a close second. @agen: you could go either way. the dow is down big time today. nicole is watching.
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nicole: this group has run up quite significantly this year for the most parts. today names like orbitz, tripadvisor all to the downside. expedia goes in there as well. a couple of things worth noting. most of them have had stellar gains this year. you have tripadvisor up over 6 60%. it recently came in with numbers better than expected pace we people are booking packages and travel and rental cars and stuff, so i have had great, great numbers. you are seeing some profit-taking going forward at least for now they say i will take the money off the table.
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dagen: the longer-term interest rates are up today. the yield is up. connell: mor moron that coming . mention walmart a little earlier. more in her report coming up. dagen: the dallas cowboys have been in the most valuable nfl team for six consecutive years. did they make it seven? american teams not even close. i look at the currency. ♪
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dagen: walmart and kohls out with their numbers. neither doing very well. connell: jo ling kent out on the streets. >> macy's has cast a shadow, the same-store sales fell flat, when
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they came out it was basically the same thing. we saw kohls missed the second quarter. the lord the estimate for the year, the nlds making $4.15 versus $4.35 previously. walmart, take a look at this, mr. street estimates as well. the revenues rose, missing the 118.47 that analysts were expecting. same-store sales fell, the street with his putting a 1% increase. the number of customer visits fell by half a percent. it comes up international shopping center released retail data from across the center last week. that was definitely saying the news was not going to be good. source open at least a year.
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that was down significantly from the 5.5% that we saw in june, and they say customers are being frugal especially about clothing. they expect back-to-school season total sales will rise from last year to $42.2 billion less than 3.6% gain in 2012. bad news for retailers could be good news for consumers. they're going to be going after sales extra hard. the second most important shopping season after the christmas season three will be offering deeper discounts, more discounts for shoppers. you can still go out and get a good deal. still possible, still a silver lining. connell: breaking news now has another newspaper website is havinn some issues at this hour. the website has been hacked
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today. readers censored stories are being redirected on the site of the syrian army. supporting the president. working to resolve this issue, the "washington post" website has been hacked. dagen: it is not good for cisco stocks. playing playoff 4000 people and the stock is down more than 7% right now up more than 50% in the last year, but what does the future look like? connell: sorry for calling detroit's residence dumb and lazy. emergency management director now on the defensive. so we will talk about that story. the market off the lows. even with that we take some winners of the s&p 500 including calls.
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--dash kohls. we will be right back.
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dagen: here's what is coming up in the next half hour of "markets now." the dow sinking the jobless claims move lowered nearly six-year low, wall street fears the federal reserve will move to pull back. interest rates moving up today. city manager says he is sorry for remarks many believed to be racist. he says some people in detroit are lazy, but also rich. homebuilder confidence near an
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eight year high. but a guest who says we are not out of the woods yet. maybe misplaced optimism. connell: you can see the dow started to selloff. a lot of times you see a company announced layoffs, 4000 workers as the stock will go up. nicole, that is not happening for cisco. nicole: i am sure it will be the member for the operating officer. out with numbers come out with news on layoffs, 5% of the global workforce containing 4000 workers and tightening their belts for the latest quarter now. an 18% jump in profit in the fourth quarter. orders rose 5%, orders from asia declined and business in china fell some as well.
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you are seeing the fact cisco systems down dramatically after the quarterly report with all 30 dow components lower today because of what you were speaking about moments ago. they are having to cut back the workforce which would help them on the big payroll. you can see the stocks down significantly. dagen: is this what investors have to worry about the most? stocks are heading the exact same direction than 170 points right now. i have asked this question over and over again, as longer-term interest rates rise will stocks fall? is there more of it to come? >> is predicated on the fact we have had huge multiple
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expansion. eernings growth reported for june 30 was only up 39. small-cap stocks, russell 200021 times expected earnings. 20 times expected earnings, really priced for perfection. the s&p which is a little over 16 multiple. the multiple estimates on the street are still much too high. started the year at 114. now at 108.5. i do think they will converge down to about a hundred and three. you don't have a lot of earnin earnings. we look at individual stocks, dagen kamas we do. it is getting increasingly difficult to find stocks with high return on investment.
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dagen: the fact they're doing this looking ahead and the economy is troubling. you look at stocks, they are fully valued if not overvalued given, but you'd look at the bond and treasuries, they arguably are more expensive, so where do you go? you have to be careful what stocks to take in the stock market. >> you have to be precise and stick with deep value if you can find it. the other thing that will ultimately overhang the market is the debt ceiling. after congress comes back, i went back this morning and said look at what happened from july 7 through 2011 until we reached a conclusion. the s&p declined, i am not really hopeful congress will get together to raise the debt ceiling levels so this is really a problematic area. i am not worried about tapering.
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if you look at unemployment, it is not 7.4%. i am not worried in the short term. they will continue the policies. i don't think they're going to see major tapering. we are not 6.5% unemployment or inflation. dagen: where in the stock market are you finding value? even if you want to mention a sector. >> some of the technologies that have bulletproof balance sheets that are still growing, they have got nothing but cash, based on this year's earnings they are selling anywhere between eight to 10 and a half times earnings. these are really fine companies, proprietary technology. the right balance sheet, they are not getting much respect at this point.
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dagen: respect to you. be well, scott. connell: from boston to detroit for the emergency managers had to apologize. actually called himself dumb for: the residents of detroit dumb, lazy, happy and rich. here is the quote. for a long time the city was dumb, lazy, happy and rich. detroit has been a center of more change in the 20th century than i dar other city. but allowing us to have a competent that helped if you're an eighth-grade education you will get 30 years of a good job of the pension, health care but you don't have to worry about what is going to come. orr was hired in march to fix the crisis of detroit but ultimately the city filed for chapter 9 bankruptcy last month saying it was unable to pay off a long-term debt estimate to be more than $18 billion.
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dagen: we know what he is saying. one of the most prosperous cities in the entire country and people, the public sector workers were getting rich pensions and the private sector were. connell: other people have had a similar message for years and phrased it differently. dagen: exactly. new york citnew york city to bee fate as detroit. dealing with the pension and health care cost that has mayor bloomberg calling the risk of a bankruptcy a real concern. connell: david lee miller joins us. >> consider this, detroit is the largest u.s. city to ever declare bankruptcy. up to $18 billion. a little more than three months time. they will elect a new mayor, just days ago mayor bloomberg had his words reverberated around new york.
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>> bloomberg says pension and health care cost contributing to the financial ruins threaten the economic stability. most new york city employees and retirees pay nothing for $6.3 billion in annual health insurance. workers pay little for pension that have taxpayers on the hook for $8 billion this year. spiegel in your city has 10,000 police officers retired were for under 40 and clayton pensions and they will collect the pensions for the rest of their lives. >> expired at least three years ago, the next mayor will be under pressure to win concessions. >> the unions have tried to wait it out. putting in tough businessman. >> may remember when the city almost went broke after president ford said no to a bailout. since then, the board oversees
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the city budget, the editor of the chief and newspaper for city workers calls bloomberg's warnings about the bankruptcy fear mongering. >> it is partly a scare tactic and looking to deflect any blame for his basically having abdicated his his possibilities of mayor to negotiate timely new contracts. >> according to mayor bloomberg, every u.s. city has a lesson to learn from what happened in detroit. across the united states, state and city pension funds are now underfunded up to $1 trillion. back to you. dagen: thank you so much. connell: another reason to watch the mayor's race. dagen: the anthony weiner commercial came on. it was obviously local, but come on. connell: moving onto housing,
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and other big story today. highest level in nearly eight years. but it may not be all good news. dagen: as the saying goes, everything is bigger in texas. at least it might be when it comes the dallas cowboys franchise. to reiterate, i hate the cowboys. connell: former pro bowler's leading the latest lawsuit. against the nfl for concussions. that and more on the market selloff coming up. this man is about to be the millionth customer. would you mind if i go ahead of you? instead we had someone go ahead of him and win fiy thousand dollars. congratulations you are our one millionth customer. nobody likes to miss out. that's why al treats all their customers the same. whether you're the first or the millionth. if your bank doesn't think you're special anymore,
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connell: tim time now for the fox business brief. stocks trading sharply lower today. the worst declines since june 20. so there you go, down 166 on the doll. as for other stories we are following, investors are looking for more economic reports and criminal latest out of the labor market. jobless claims fell by a larger than expected amount. 320,000, the lowest since october of '07. the prior week' revised lower. jcpenney trading higher today. george soros added other 2 million shares to his large
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investment in that retail. he reportedly to own now nearly 20 million shares at the end of the second quarter. jcpenney the second-largest in his portfolio. join us at a quarter million tweeters is beare tweeting. and 900 million dollars are changing hands online. that's why hp built a new kind of server. one that's 80% sller. uses 89% less energy. and costs 77% less. it's called hp moonshot. and it's giving the internet the room it needs to grow.
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this&is gonna be big. hp moonshot. it's time to build a better enterprise. together. dagen: confidence among homebuilders at the highest level in almost eight years, but sanders says they may be kidding themselves. >> thank you for having me on. a couple of things. look at a chart of homebuilder confidence, which is great, i'm glad we're so confident. applications fell and have been declining ever since 2010, they have been flat. with rising interest rates mortgage rates have been coming down. interest rate rises are not going to help people buy a home.
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dagen: so much activity we have seen, and i have witnessed it firsthand, all-cash buyers particularly in these areas, they are foreign buyers. if they're getting loans, getting them overseas, still considered all-cash buyers. this is a situation he won't have the same impact it did in years past? >> you are absolutely right. people do not lose a lot of money in the last housing bubble and can cash out and buy a new home with cash. we're seeing average mortgage size for homes. if you look at a chart of homebuilder confidence against new home sales there is a fundamental disconnect. we may have a case of what bob
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shiller would call irrational exuberance or what we call the minsky bubble. dagen: finish your thoughts. >> the communist professor. if you take a look at it, it may be homebuilder expectations, certainly bubbles everywhere else. dagen: in terms of the homebuilder confidence, are they not looking at the potential for additional supply from existing homeowners because as you have seen prices go up, you are seeing people no longer underwater. that gives them the incentive to sell, people can make money on the sale of their home. the additional supply will hurt the homebuilder business. speak a little bit of both. if you look at the recent rises of the case-shiller index or the house price index, you're almost showing a missile like
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trajectory for house prices. it has to make homebuilders feel really good but that may not translate into a lot of new construction for homebuilders. unless foreign investors want to buy them. wall street wants to build new homes. connell: they are buying them up hand over fist in places like las vegas. be well, we will speak to you soon. as always. connell: he will be very angry if we don't continue on. jason joins us from the floor of the new york stock exchange, things are getting a little bit better, i guess, with the market selloff. is that a jacket? >> it is national relaxation day.
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connell: hold on a second, that is what we should have gone with. dagen: you just made that up, national relaxation day. >> i ppomise you i did not. connell: no wonder the market is getting hammered. >> the walmart numbers were a little light, the market is selling off in that. it is what it is. we are on anemic volume. i would not place a lot of faith in the market direction right now. compared to what is happening if you look at the performance of the year, this is nothing to be concerned about. nobody is paying a lot of attention in the long-term investment institutional investment world really unfair to judge the market direction with this kind of anemic volume. we saw accelerated volume to the up or the down have a lot more
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conviction of what the market is doing right now but we will continue upward as people come back from vacation. connell: it looks like summer camp with a bunch of kids behind you. the market getting killed. jason, thanks, good to see you. national relaxation day. dagen: everybody should be prone to lay down on the floor. to the nfl, one of the most gripping stories in nfl spores s and the problem is getting bigger. hit with another concussion lawsuit pitting estimated total number of players filing these suits are whopping 4500. fox sports one senior nfl reporter. connell: before that, this was not a difficult list to put together on a day like this. on the nasdaq. [ male announcer ] how do you get your boue?
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dagen: the national football league 32 teams are worth on average $1.17 billion. that is 5% more than a year ago come but some teams rake in a heck of a lot more money than others. here are the top five valued teams according to forbes. number five, the houston texans. number four, the new york giants. number three, hailed the redskins. your washington redskins. number two, team that elicits from the crowd, new york new end patriots. and number one, the dallas cowboys. for the seventh consecutive
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year. and the jets are nowhere to be found. dagen: they are actually six on the list i believe. dagen: really? connell: the nfl's phase one of the biggest lawsuits. warmer pro bowlers have joined anyone other players in the latest suit against the league claim it was negligent about the dangers of the head injuries. the total number of players still in nfl over 4500. senior nfl reporter for the soon to launch fox sports one. thank you for coming on. this is obviously a big story for some time, now that you see some of these big names coming into it, what is next? as if this'll take a long time to play out, right? >> it sure is. september 3 is a big day. scheduled to meet with the nfl
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and the lawyers representing all of the plaintiffs. she ordered mediation to see if an agreement could be reached before they have to take the next step in the legal process. that would be the proverbial hail mary situation. and so the next big step will be whether or not this goes to an arbitrator or if it actually goes to trial remember a lot of discoveries with 14500 former players as you said it have gone ahead and join this lawsuit. connell: interesting you separate them for group of about 300 that play before 1968 between 1988 and 1993 because in those years there was no click of bargaining agreement in place. they understand if they might have an easier case because of the lack of union involvement or no click to bargaining agreement being in place. is that true? what happens the other players who did not play in those years?
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>> there are other people involved in this, i don't want to go ahead and be put in the same lump as other players. kickers and punters claiming concussions. there is a former wwe wrestler who played in the nfl who is suing. connell: it brings up a larger point. even players to get banged up playing football, could have happened after they retired or before they played. legally it can be difficult in some cases to prove this, i would think. >> that is what the nfl is so proactive to get baseline testing into players to find out ithey aren't a greater risk on the time they come into the nfl. they don't have these standards from when they played for a lot of these lawsuits, so you don't know the player got concussed before they got in nfl and they could have suffered, after the nfl. connell: terrific insight and best of luck with the new
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network launching this weekend. fox sports one. dagen: yeah, baby. connell: they have a football show every day at 6:00 eastern starting a believe next week. will be good. dagen: one particular suborder, bigots and the type of drama facing athletes. focusing on the market. walmart rolling back the dow falling flat on his face. in all-star panel is ahead to break it all down. connell: saving drive-in movie theaters. now the drive-ins threatened with extinction. the vice president of honda america will be here with that companies plan to save drivers coming up. "markets now" continues in a moment. stay with us.
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hundred pound gorilla of retail, walmart, pressure at this hour responsible for 14 points of losses. the retailer cutting its annual profit forecast, we debate the wear and the why of walmart's problems with our panel. raising the roof on housing yet again, home builder confidence rising to the highest level in eight years. a brand new feature on fox business as we break down home construction costs. plus savings driving movie theaters, once they were plenty but not yet threatened with extinction, vice president of honda america to help save and american institution. it is exactly the top of the hour as we go 15 minutes, stocks
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and l. the steepest decline since june 20th, nicole petallides watching the data, the numbers from the floor of the stock exchange. welcome back. >> we're seeing a market that has been to the downside all day. after we got economic news early this morning, it was mixed but the jobs picture look like it had improved and with that would happen ultimately is the bond bank program could be to the grid to a certain extent, $85 billion in bonds depending on whether it would be tapered and with that type of chair. that put some pressure and spooked the market, dow component and down arrows, all 30 had been in the red, haven't had a winner until we had seen names like cisco systems and walmart hall with headlines of their own which is hitting those stocks in particular. the dow is down 230 points, the lowest point certainly looking consecutive weekly loss and the fear index is up close to 7%.
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cheryl: at least the dow was up 17% year to date. when you look at the down days you got to remember the bigger picture. good to have you back. two big retailers reporting second quarter earnings. walmart and kohl's, it is not a rosy picture for retail overall. joline kent is live in the streets of midtown manhattan with this. >> it is shocking season, people are walking by next to the gap but retail sales are not doing well, and he sees cast the shadow yesterday. walmart is down 2.5%, kohl's reported a miss, they're a 5% so check this out. in the second quarter, three.5%, reported higher expenses, lower their bps for the year, profits for the quarter were down
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$213 million compared with $240 million a year ago and walmart missed estimates as well, revenue rose 2.4% to $316,200,000 but still missed, and in the woods from we expect a good barometer for luxury sales, expecting their earnings to be $0.88 per share on revenue of $2.9 billion a leggings numbers right now. you might get a better deal as they ran up numbers for the current quarter. cheryl: it is back to school, joline, thank you very much for a look at the numbers and let's bring in disappointing news out of the sector, the cote portfolio manager, also fiberglass managing director raymond james. i want to start with you because in june you raise your rating to outperform on a walmart. curious how you are feeling about the stock today after what we got. >> it was where it is right now and that is when we raised our
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rating on the stock. stock had come in an fallen from $80 a share. we thought was a pretty good place to hide what we thought would be volatile and may be choppy second half and for those portfolio managers whose mandate is to stay fully invested, and in their benchmark, this is the proper time to overweight the stock. we didn't take it to the highest rating, we took it to a two rating or perform rating but that was our logic. we are not all that surprised that sales are bit choppy, the environment is not particularly great. >> that is a crucial question. with walmart, it is a payroll tax. and they had been chopped in several states. and walmart customers are trying to cut corners. what is the problem at walmart?
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>> little more granular. payroll taxes and issue and their customer does, and the economics are more difficult, and the other expectations, inflation fairly moderate in the corner, and increased expectation for increased inflation by 100 basis points so that impacted. actually had very good cops so it really is a mixed bag. cheryl: international institutions as well. i want to bring brian perry into this. you own coles and macy's and the fund and macy's kicked off the negative sector problem we have now got with the entire retail sector. the problem is happening at walmart do you think that is happening? they did not have a quarter this morning. >> we are seeing concern for consumer discretionary area.
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we had a great run up and you are starting to get a little bit of a slower revenue number coming out, people have done cost cutting so what you have to do here is drive the top line revenue and that is a difficult environment when you are only getting 3% growth but we are seeing a number of companies doing creative acquisitions and driving those -- cheryl: consumer discretionary sector overall is changing a little bit. >> we still like it. i still like the middle sectors very much so. we kind of shifted out of the low end consumer discretionary numbers into the middle and starting to see some attractive valuations. cheryl: i want to bring you in on this consumer story both of you, crucial to each of your investment feces and brian's fund when you look at the consumer and the stress the consumer is feeling i wonder if
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this group as a whole has gotten ahead of itself but this is not a sector, a bit overvalued. the markets are overvalued but consumer discretionary. >> we talked about that in the riding the we are looking for more experts and many of our names so we are very valuation conscious and that cause us to raise walmart and at the time we did, we had been fairly standoffish on the stock for well over a year and that was the right call. the environment does in fact play into what will happen over the next six months but remember our clients need to be fully invested and this is foremost in our thought process. cheryl: you are sticking with your thesis at this point, your holdings. >> absolutely. we have got a couple years left in it. cheryl: i can never doubt that. thank you.
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thank you bose, interesting day for retail, holders and stocks, thank you very much. if you own shares of cisco take a look at this, stock is the biggest loser in the dow. this is despite news the company is cutting 4,000 jobs. we have analysts coming up to reduce costs and refocus. also following this, the president condemning the crackdown in egypt with deaths climbing to over 500. president obama canceling joint military exercises. more on his comments coming up and as we go to break, the energy sector, look at oil, in the 107 range. we are jumping on crude, also hire. [ male announcer ] at his current pace,
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our commitment has never been stronger. a quarter million tweeters is beare tweeting. and 900 million dollars are changing hands online. that's why hp built a new kind of server. one that's 80% smaller. uses 89% less energy. and costs 77% less. it's called hp moonshot. and it's giving the internet the room it needs to grow. this&is gonna be big. hp moonshot. it's time to build a better enterprise. together. cheryl: we are seeing june 20th. down 180 points. and this is 13 points. here are your.
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and reiterate the point everything is to the downside 1%. we will see how the date shakes up, story stocks, company news that was not good and talking about retail as well. let's bring in nicole petallides, a look at estee lauder. i hope there is some good news today. some bad news out right now. >> when talking about estee lauder everyone is familiar with it from skin care to make up, hair care, fragrances and the big picture is a good one and as a result you are seeing a lot stock reflecting numbers they have given out up 4.7% on a day when the dow jones industrials cabin down 200 points. there is a nice start for you, you can see it is higher for the year up 5%. another thing they did was posted quarterly profit in the fourth quarter, the rise of 84%. different divisions from
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fragrance to hair care but it was really skin-care and makeup products that helped to move estee lauder to higher level today and also in its quarterly profit they reported which was a cell of 84% so great performer. >> thank you for that news. some more fun, charles payne making money which i think is something every day. a big hit in technology. i assume it is not cisco. charles: i haven't liked cisco in a long time but it is a company that has been volatile in the past, a graphic chipmaker,,years ago before the internet boom the graphic chips were hot, they got crushed and were hot again, this particular stock was really hot in 2007. it was considered stock of the year by forbes ending january 30th dollars proceeded to go to $6 before the year was over. all that said i think the company really does have its act together and last time they
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reported record gross margins by back their own stock and earnings up 28% quarter over quarter. they have nice traction going and changing the model little bit. not only do they still graphic chips it using licensing technology. they were at a conference and will be at another one and tomorrow but the point is this is one of these names that has been around a long time. it has a bunch of drivers to help get up there. even though we are down 2 and the points it is on the cusp of -- cheryl: what they doing differently or doing better than their peers? obviously on the chart your splitting the difference $15 a share and change. it is not 6, it is not 30. charles: execution is important. let me give you the last four quarters the beat the street by 10% and beat by 17% and 30% and 23% and it is getting better. i want you to take a look at
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this. it is ironic, look at this, look at that. that was january 2nd. company of the year, that was the chief technology officer, stock was $30 a night and 12 months later was six. since 2008. but they have come back and done things right, they learned things power away and the stock is up $20 a share. cheryl: very cool. and for so many years, but the stock from the tech bubble. charles: they have come back. cheryl: home builder confidence rising to its highest level in eight years. you do not want to miss our exclusive technology will only see on fox business, we will break down the cost of a home. lumber piece by a member of peace by window. we will talk to the ceo, one of
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cheryl: president obama canceling joint military exercises with egypt following growing violence in that country. peter barnes is in washington monitoring of the president on his vacation but he did a little work today. >> the president took a break from his vacation to make that announcement on egypt. >> let me say the egyptian people deserve better than what we have seen over the last several days and to the egyptian people, let me say the cycle of violence and escalation needs to stop. we call on the egyptian authorities to respect the universal rights of the people. we call on those who are protesting to do so peacefully and condemn attacks by protesters including churches. >> the president did not take the step of freezing u.s. aid to
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egypt to. that is under consideration as well but that he did's $1.3 billion a year in military aid. in the economy but violence has so far not affected the suez canal though oil prices have moved higher on concerns that it might. tankers move two million barrels of crude oil a day through the canal, canal spokesman told dow jones egyptian military and naval forces have increased security along of waterway and shipping traffic was normal. cheryl: good point. watching energy of today as well. thank you for the live report out of washington. cisco shares the biggest loser on the dow, stock is down $1.67 despite the network equipmentmaker cut in 4,000 jobs. usually like layoffs but the company is saying there's going to be a fresh attempt to reduce costs and refocus on growth.
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communications internet security analyst, john chambers said they would refocus the company, job losses are unfortunate, but he also said this is one of the strangest turnarounds the economy has ever seen. what did he mean by that? >> thanks for having me here and i do think cisco is struggling with the slower economic recovery than they hoped for an dollars had hoped for. quite frankly there was some optimism we would see a pickup as we get into the latter part of the year and cisco's commentary-most of those hopes. that is a little behind it. cheryl: is it the competition? is it hp? to encroach on cisco's visit? and weakness in asia that hurts cisco, is there one problem, one type of business with instantscope that need the most
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help? >> cisco is transforming itself, evolving from what was largely a network and communications company to the number one i tea co. in the world meaning they need to expand in a lot of new markets. in essence their traditional markets, rotting, switching are fairly mature and in order to get to the growth rates they need they need to expand into things like service provider of video and collaboration and data center servers. those are areas that they need the growth and that is what the focus is going to be going forward. cheryl: is it fair to say cisco has had to misfires when it comes to the consumer market? and business services and you mentioned wireless technology, network conferencing, conferencing for businesses and things like that but would you agree the consumer side had big
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issues? >> i don't think anyone would dispute cisco's for a into the consumer market didn't work out and eventually they recognized that. the company strength is in the enterprise and service space and that is where they are going to place their bets going forward. cheryl: what problem is asia, they show a 3% decline for asia. they also saw the revenue for the u.s. fairly decent but asia was the problem. is that something you are concerned about? do you think the u.s. will float the rest? >> i think they will struggle to get to the target growth rate they had which is 5% to 7% top line growth for the next several quarters at the stand asia is incrementally getting worse but it is not a huge exposure. china is a challenge and china is 5% of revenue. i think asia is a factor but the
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broader issue is traditional markets are fairly mature and that is the challenge they have, transitions in technology are really working against cisco to some extent. cheryl: a shame to see 4,000 jobs cut but we will find out more this afternoon. thank you very much, cisco the company, you are going to want to join me on "countdown to the closing bell" at 3:00 p.m. eastern time when i will talk to cisco ceo john chambers. i will be back. the fox business all-star showdown, the ultimate stock-picking competition down to four contestants and scott martin and robert luna are back to battle it out. take a listen. >> i am scott martin, chief market strategist of united advisers. would be an absolute freeze to meet robert luna in round 2 of the fox business all-star show down. i am so confident my picks will be robert's i will bet two
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chicago style deep dish pizzas and deliver them myself. see you soon. >> robert luna, congratulations on making it this far but it is time to send you home on the fox business of star showdown would divide his i will send you 1,000 tamales from phoenix, arizona. >> i need to talk about robert where those will come from. who will come out on top? do not miss the fox business all-star showdown friday at noon eastern time, you will only see that on fox business. and home builder confidence rising to its highest level in eight years. you don't want to miss a brand new feature on exclusive fox business, we will rebuild the cost of building a home piece by piece. and there were 4,000 strong and drive in movies are threatened with extinction. vice president of honda of america is here with the company's plan to help save this american institution.
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nicole: on the floor of the stock exchange every 15 minutes on the fox business network get you covered, we look at the markets and names on the move and let's start with some retailers gaining headlines easily today. some good news and some not such good news. that name like walmart out with its quarterly numbers and it is under pressure like macy's. customers are affected by high road parallaxes, they don't have as much money to hit the stores and go shopping and customer traffic, we are watching that and we are seeing a name like
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jpmorgan after george soros is optimistic and that is a writer and dillards, those are on the move and delete same-store sales jumping and that is good news so some big retail movers and we are seeing dow jones industrials in the wrong direction, about 171 points and a low of the day. cheryl: we will follow the markets but home builders are feeling more confident about this market. we thought it would be a great day to debut exclusive technology at fox business. what does it cost to build a home piece by piece? let's start with the foundation, $16,033 to build the foundation. let's move on to the framing of the home. $46,375. the roof, got to have a roof, now you are at $52,000.
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at some plumbing. so is the material cost, $60,581. now the electrical, at the electrical into your home you are at $72,000 and i wish i had been an electrician because they make good money. will get this. we have added the heating, the ac, $30,000, moving on to the floors, $88,000 in change. got to have wall staying pretty pictures on, now you are over $100,000 to build a home. this is not to sell a home but to build a home. now to the windows this is the national average, we decided to take all the homes throughout the country and build the windows at $107,000 on a national scale. forget new york. that is another sore. the exterior $115,000. landscaping if you choose to do that and a lot of home builders to throw that in with the cost of a home your at 125 grand and finally all others you add $156,000. it is expensive to build a home
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if you are on a home builder, don't even want to sell it but as i mentioned earlier home builder confidence near an 8 year high in august of three points from last month, we are nicely above 50, the housing market index, anything over 50 is good and this is according to data from the national association of home builders. let's bring a fox business exclusive interview, jerry howard, a nice build despite interest rates going up. >> they are telling me one thing, it motivated buyers walking through the doors again. it is bringing up across the board. cheryl: this builders' survey i look at every month, a current sales, a jump of three points, feeling optimistic about current sales but six mother expectations only at the point.
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is there nervousness about what the rest of the year will hold and is any of that -- >> there is nervousness about capital supply at the front end of the pipeline, builders are nervous about loans to acquisition, development and construction and that the consumer end is extremely difficult to get a mortgage. that is holding the expansion of confidence in place the economic recovery from coming back. cheryl: i was showing our viewers piece by piece what it costs to build a home. that is what your members do. in the month of june we saw construction spending doubled little bit and i was wondering if that was a pullback, it wasn't huge but i wonder if the pullback, in the month of june, is that seasonal and interest rate. >> you see a dip in construction creeping up. cheryl: one of the things i ike
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to look at is the housing markets and this is not just new home sales which is your bread and butter but existing home sales as well. most of those markets are in california. what are builders telling you about california and the west over all? >> california and the west naturally is a growth area. the economy in those areas particularly parts of the west that have to do with energy and natural resources and manufacturing. as they improve the housing markets heat up. is not surprising but also driven by the fact that foreclosures are weighed down and existing inventory on the markets are down so people are starting to buy. cheryl: i am curious when you talk to the builders and of course a different conversation, you publish some and i am curious if they are concerned about the employment picture. we get a little bit of a drop in initial claims but not to where we are having true job creation
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really giving us higher paying jobs. do builders look at that type of data when they decide whether to build in a certain area of the country? >> of course they look at employment but most builders tell me one of the reasons employment is coming back as we are not back at full force and those builders are having trouble finding labor themselves. it is the cycle that is created and once the capital gets back in the market we will create jobs that will help employment and also spur the economy. we are on the threshold of coming with great guns. cheryl: new stocks on a tear. jerry howard, great to see you again and we will see you in a month. talking about the builders. this -- take a look at these stocks. these stocks are trying to make a come back after big losses kicked in yesterday and over the last couple months.
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joining me from chicago morning star equity analyst james carville. these building stocks, some of the hottest stocks of 2012. until june they were popping and we started to see a pullback. what is the overall problem? is it the mortgage interest rate situation? >> vocal back in homebuilder stocks directly to the interest rate rise of 100 basis points, 30 year interest rates of 40%, sticker shock on the part of consumers looking at rates being this much higher and homebuilders themselves, we are seeing some companies downplay the impact of interest rates. we have seen that from pulte group and taylor morrison and others saying that higher rates in the back half of the june quarter started to see slower activity through july. cheryl: in your research you say housing affordability is strong but we are seeing that dynamic
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shift especially in california which is when it comes to the economy crucial to the overall story for home builders especially in the north part of the state. you're seeing that shifting affordability in california, that will start happening across the country? >> in certain pockets in california, prices are from the bottom so those markets have the biggest downdraft as well so it is well below the previous peak, housing affordability is strong when you look at after-tax mortgage payments relative to income or relative to branch. and it is still pretty strong. and it is less positive for housing. an after-tax mortgage relative to branch we estimate rates will rise another 260 basis points.
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and existing home median prices rising 26% to bring home affordability in line with 1990s average level. cheryl: and on your radar and not in a good way. thank you very much for morningstar for the analysis. >> no problem. cheryl: getting out of bold, should you follow the crowd? and saving an american institution. the campaign to rescue drive-in movie theaters. we will be right back.
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>> your fox business brief. stocks are trading lower with major averages experiencing exclusive declines since june 22nd. concerns that the fed could roll back its economic stimulus. checking stocks the dow is down 190 points. investors looking at another round of economic news including the latest on inflation. consumer prices rose 0.2% matching the estimate as the cost of goods and services rise from tobacco to apparel. even without food and energy the cpr was up matching the estimate. washington post register is kept. the newspaper posted a note on
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its web sites a readers of some stores have been redirected to the web site reporting the regime of experience of president bush are al-assad. a fox business network giving you the power to prosper.
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fax cheryl: a lot of data today, the market didn't like. we are pushing session lows on the dow, nasdaq and the s&p and the dow is up 17% for the year. the s&p up 18% for the year and the nasdaq up 21% for the year. you got pull back and sometimes this happens, and that is the market on the piece of this loss. and they are as american as apple pie. only 368 are left, and
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projector's of digital technologies, many are going out of business. american honda taking up the cause, senior vice president of operations. be honest question is why would honda take something that although drive in movies are nostalgia don't seem to be successful anymore? why take on this cause? >> we believe in helping our customers in any way we can and we understand we saw lot of cars to consumers in rural areas and thrive ins are part of their lives so when we heard about this, and that culture. cheryl: i can get my friend's 2-year-old off of the ipad these days. it is billing hand held and a mobile. a great piece of american history but are people going to drive ins anymore?
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>> in rural areas the only choice for them to make a long-distance commutes into an urban area to watch a movie, in the northeast or southeast areas these are very popular, and reach out and help them out. cheryl: how come honda doesn't give the money? and running a promotion if you will? why not make this donation on the part of honda? >> there are 368 drive in theaters in operation and how would we pick the ones. we could pick and we could save a few and change a few lives and post content or help whole communities and what we are trying to do is not just the donation of the projectors we are making the try to get people to pledge to go to a drive in and make contributions themselves and we had some
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success over six days, over 600,000 people came to the web site gerri: interesting social project on the part of honda. thank you very much. quarter till and stocks every 15 minutes and you don't want to look at this but the dow falling below the 50 day moving average. whatever technical sense of what we are seeing on the chart. nicole: when you talk about the 50 day moving average that is so key. 200 day moving average would be killing but what we should note is we have been in the fairly narrow range. we are still above the 15,000 mark, 15,150 one, we are down 230 points. we should talk about the fact that this is really negative market, two thirty-nine million shares to the downside versus 70 to the upside so we are seeing
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selling across the board weather is energy or technology or financial across the board, much of this from better than expected jobless claims and what happens is people begin to worry that the fed will taper their bond buying program. that is a ripple effect so you start to see the ten year treasury moving and we see 2.78% yield on the treasury and worth noting the vix has been jumping as well. cheryl: thank you very much, there is a holding. getting out of gold. george soros and john paul's and dumping big holdings in the metal. in the trading pits of the cme, phil flynn, is bowls not hot anymore? >> it wasn't last quarter. it is one of the few commodities bucking the downward trend of the red we are seeing on the screen today. you got to remember when it
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comes to gold it has 70 different personalities. one of the personalities has been out of favor, the investment demand. when people thought europe would fall apart and the world is coming to an end they ran into gold and ran it up and ran it up higher than it should have. a lot of panic buying and when the panic went away we saw the price came down dramatically. we don't want to hold on to the goals but if you look at the physical demand for gold, it is stronger and stronger every day. the world cold councils of the visible demand for gold was up 53%. cheryl: you sound like a contrarian on gold but i will take it. >> we need some contrarians around here. cheryl: a little optimism. thank you. southern california home prices falling in july. i will have details in the west coast minute.
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are tweeting. and 900 million dollars are changing hands online. that's why hp built a new kind of server. one that's 80% smaller. uses 89% less energy. and costs 77% less. it's called hp moonshot. and it's giving the internet the room it needs to grow. this&is gonna be big. hp moonshot. it's time to build a better enterprise. together. anbe a name and not a mber?tor scottrade. ron: i'm never alone with scottrade. i can always call or stop by my local office. they're nearby and ready to help. so when i have questions, i can talk to someone who knows exactly how i trade. because i don't trade like everybody. i trade like me. that's why i'm with scottrade. announcer: scottrade- proud to be ranked "best overall client experience."
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cheryl: time for your west coast and. prices for homes in san francisco jumping, there was a cool off in southern california for the month of july, home prices were down in setting california state at $385,000. jan -- june was a record-setting month with prices rising 20% year over year so take that. the state of nevada launching a new web site to help veterans find jobs. and the site is named after designated places for soldiers in baghdad during the iraqi war. 300,000 veterans can use the site to connect with employers and research education and health care benefits. and good retail news, how about
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urban outfitters in hawaii, according to pacific business news the company is planning to open its first hawaiian store at the hyatt regency waikiki. urban hasn't changed the reports but 1 dirty locations in the u.s. canada and europe. and urban outfitters last time i checked were trading rather flat. and i would get that to you tomorrow. that is a west coast minute. not to something else and that is jeff flock. it doesn't want some jeff flock in their day. consumer prices rose let me in july but historical standards, one ceo says the slow growth is a new normal and he is standing by with the funny hats on. >> i appreciate the charity. and we are talking food.
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it was 91% of market share. and corn muffin mix, you have 64% of the mix in general, small company. you don't advertise the thing. >> everyone tries to find an unfair advantage. and don't do coupons or freestanding insert. and less money than the competition. >> your grandmother's invented muffin mix. you have been running the company the same way, turned away wall street raiders that attempted to come in and take over your company. >> we appreciate the contract. we had no interest in selling the company. any other owner would change it. >> screw it up. >> yes. we are not interested in it and an obligation to our consumers
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and employees. >> cheryl mentioned at the outset this economy we are in right now is the new normal. >> the economic turndown in 2008 is going to look normal going forward. i don't think we are ever going to get back to the heyday where frankly there were a lot of ways and productivity is something less than it could be. >> the company ceo, powered holmes. he likes to be called howdy. more with howard holes throughout the day on the fox business network. i will have the hat on all day. cheryl: good because i will be sitting in at 3:00. by the way urban outfitters is down 1%. i promise you something i am going to deliver but i will deliver another show to you. in the next hour of markets now, chaos in each of the intensifying, 500 dead in clashes over the muslim
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brotherhood backing down taking -- stick with ashley and glory in the next hour. meanwhile, losses all-around dow, down 189 points. we continue to follow today's sell-off, wall street looks at a forecast from walmart and cisco. needs a super hero to save the day. how about saving your portfolio? next, a look at alternative investments that could make some real paper. comic books. we will be right back. you know throughout history,
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now where's the snooze button? speak of it afternoon, i'm ashley webster. lori: i am lori rothman. the steepest decline on an earnings double whammy. ashley: what is the largest retailer saying about the state of the consumer, low income shoppers have investors worried.
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lori: is now the time to follow the smart money? placing their bets now, should you follow? ashley: protesters storming, 525 people dead, 2000 injured. president obama says the violence needs to stop. let's go to the floor of the new york stock exchange and our very own nicole petallides. nicole: there is a lot going on here. the dow jones industrials down 195 points, which is a loss of one and a quarter percent. the mentality here on wall street is an interesting one. i